Leung Chun Ying

Leung Chun-ying is urged to declare all stock interests

Leung should honour the spirit of the declaration system, analysts say, amid public concern

PUBLISHED : Thursday, 16 August, 2012, 12:00am
UPDATED : Thursday, 16 August, 2012, 3:52am

Leung Chun-ying has been urged to declare all his links to his former property business no matter how small.

The call for the chief executive to adopt a "whiter than white" policy came after new media revelations that Leung has share options in surveying giant DTZ Holdings, of which he was once Asia-Pacific chairman.

The options, confirmed by Leung's office after the reports were published, are held through British Virgin Islands company Wintrack Worldwide, in addition to a "foreign branch" of DTZ reported earlier.

The discovery highlighted a grey area in the system of Executive Councillors' interest declarations, as it is not clear under the rules if stock options should be made public.

Under existing practice, an Exco member should declare a beneficial interest in shareholdings of a nominal value greater than 1 per cent of a company's issued share capital. It is debatable whether stock options that have not been exercised should be seen as a beneficial interest.

Leung has also yet to confirm whether the 643,514 DTZ stock options he holds are more than 1 per cent. According to a company notice issued in October last year, obtained from the London Stock Exchange, Leung was granted share options of 165,000 and 478,514 at nil exercise price in 2009 and 2010 respectively.

The deadlines for exercising the options are July 2013 and July 2014. The company appears to have issued a total of over 269 million shares, meaning Leung's options would account for less than 1 per cent.

Although a spokeswoman for his office said Leung would not exercise the options, a political scientist and a lawyer said this answer would not address the public concern. "He'd better adopt the 'whiter than white' principle," political analyst Dr Cheung Chor-yung of City University said. "If it's in doubt, declare it."

Cheung said that even if the rules did not require members to declare stock options and even if the options were not realised, Leung should do it just to honour the spirit of the declaration system. "The public has higher expectations of the chief executive and he should set a good example for others," Cheung said. But he did not agree with other critics who were asking Leung to sell all his stakes involved in the property giant: "After all, they're his personal assets."

Solicitor Daniel Wong Kwok-tung said stock options should be seen as a beneficial interest, which should be made public under the declaration rules. "It is a right and benefit that Leung is entitled to," Wong said. "We won't know if he will really give it up. The company can't say no if he really exercises his right."

He said the declaration rules should be extended to cover stock options if they now did not.

Leung pledged earlier that he would transfer his stakes in DTZ and those held by Wintrack Worldwide to a trust.